The
nuclear energy industry has gained enormous credibility among policymakers
and the public by virtue of dramatically improved performance - in efficiency
and even more importantly in safety. In the United States, coverage by
the media has been more positive than ever - even with the security concerns
that have been raised since last year's terrorist attacks.

Nuclear energy's affordability
and reliability alone would justify a role for the technology in the new
century. But an even more important reason is the mounting concern over
the environment - air quality, and in particular global warming.

Although there is
ample support for the role of nuclear energy in our electricity system,
we still face irrational opposition by some anti-nuclear groups. However,
more and more public officials - and the general public - the world over
are weighing the advantages of nuclear energy against the fear-mongering
of nuclear opponents...and are choosing the advantages.

The designation of
Yucca Mountain is an important component in a U.S. energy policy that
is setting the stage for new nuclear plant construction. However, it is
by no means the final step that assures the future of nuclear power. We
have a long way to go, and as you would recognize, many challenges remain.

We need patience,
commitment and a lot of hard work in the trenches to fulfill nuclear energy's
potential in the U.S., and around the world.

First, the Yucca Mountain
project is not complete, and will not be for at least another decade.
Twenty years and $6 billion of scientific study have affirmed the suitability
of the Yucca Mountain site, but much scientific work remains - and a tremendous
amount of work in preparation of the DOE license application to the U.S.
Nuclear Regulatory Commission. DOE expects to file the license application
in 2004, and if things go smoothly could bring the repository into operation
by 2010.

The U.S. nuclear industry's
capacity factor has risen 20 percent over the past decade, to a record
91 percent. Nuclear electricity production has increased by one-third
since 1990 - about 24,000 megawatts. That's like having 24 new reactors
come on line, with no construction costs.

License Renewal

The performance of
U.S. nuclear plants, coupled with deregulation and the drawbacks associated
with other sources of generation, makes them valuable assets to their
owners. Naturally, they want to keep them running as long as they can
- beyond the arbitrary 40-year span of their licenses.

The Nuclear Regulatory
Commission has streamlined its regulations for license renewal, and we
now expect virtually all U.S. plants to seek 20-year renewals. Ten have
already been renewed, owners of 16 more plants have applied, and owners
of 25 more have notified the NRC of their intention to seek license renewal
by 2005. That's nearly half of existing plants in the U.S., already in
the process.

Affordable, reliable,
stable in forward pricing, emission-free. With all those advantages, it's
no wonder nuclear energy is gaining political support. As Secretary Abraham
said recently, "Forcefully declaring that nuclear power should be
part of the world's fuel mix took some people by surprise, but to us it
was just common sense."

The Yucca Mountain
site designation has been the most visible aspect of Administration support
for nuclear power, but equally important is the Department of Energy's
Nuclear Power 2010 program - with the goal of seeing new nuclear plants
built in the U.S. by the end of the decade. The private sector must do
most of the work to get new plants built, including the all-important
issue of how to finance them. But the government has a key role to play.

DOE has begun the
process, awarding study grants for the untested NRC early site permitting
process to three U.S. companies - Exelon, Entergy and Dominion Resources.
The early site permitting work will help to demonstrate new NRC licensing
procedures that are theoretically more streamlined, but are unproven.

Security

Of course, one topic
that has been discussed in Washington for more than a year now is security.
It remains a concern for most Americans, and that concern has been directed
at nuclear plants.

Every nuclear plant
in the U.S. has been on the highest alert for more than a year now. Prior
to the 9-11 attacks, our security was the benchmark for the U.S. industrial
sector, and we have significantly enhanced that security. In addition
to the robust construction of the plants, they are patrolled by more than
6,000 highly trained and well armed officers, who are in constant contact
with law enforcement and intelligence agencies at federal, state and local
levels.

A particular concern
for some in the public has been the potential impacts of aircraft attacks
to nuclear plants. We commissioned an independent study, and based on
preliminary results, we are confident that the reinforced concrete and
steel containment can protect the reactor from large, fully fueled aircraft
at high speeds. Fuel pools and steel container storage would also protect
used fuel even from a direct hit by a commercial aircraft.

Our overall strategic
objective for nuclear plant security in the U.S. must be to create a seamless
defense against terrorist action.

Vision 2020

We are not neglecting
the future of the industry. Last year, we unveiled our own vision of nuclear
energy's future in the U.S. Our Vision 2020 plan calls for 50,000 megawatts
of new nuclear capacity by 2020, and another 10,000 megawatts of expansion
from existing capacity.

An additional 60,000
megawatts of new capacity might seem like an ambitious goal - the equivalent
of three new 1,000-megawatt plants per year between now and 2020 - but
it is in reality not excessive, when we consider America's energy needs
and our clean air goals. Sixty-thousand megawatts by 2020 will only maintain,
not expand, nuclear energy's market share. And it will only maintain our
current 30 percent share of emission-free electricity, even with a doubling
of renewables in the electricity sector.

Uprates

Our goal of 10,000
megawatts of expansion is realistic. Uprates approved or under review
by the NRC, or announced, will add about 3800 megawatts to U.S. capacity
by 2007. About 1500 megawatts of that is attributable to the Tennessee
Valley Authority's Browns Ferry Unit One, if it restarts as expected,
in combination with uprates at the two other Browns Ferry reactors.

In the year since
we announced Vision 2020, we have begun laying the groundwork to make
it a reality. The early site permitting initiative is part of a system
of new legislative and regulatory processes for building and licensing
new nuclear plants that includes the Department of Energy's plans.